Customers’ Fraud Claims Stick to Spark For Now

SAN FRANCISCO (CN) – A federal judge on Monday refused to dismiss a class action accusing an energy company of defrauding lower income individuals by preying on those with moderate English language skills. U.S. District Court Judge Jeffrey White denied without prejudice two separate motions by Spark Energy Gas, a natural gas supplier and utility company – one to compel arbitration and one to dismiss – in a ruling handed down Monday. White granted the plaintiffs request to delay a hearing on class certification until August. The dispute stems from Spark’s program of going door to door attempting to convince homeowners or renters to switch from their present utility companies to Spark. Lead plaintiff Arturo Amaya, an LA resident, says he was approached by a Spark sales representative sometime in October 2014 and was told Spark offered a program designed to help low-income families save money on energy bills. The unnamed Spark representative said switching would save Amaya about 25 percent on his energy bills. Instead, his bills increased by about 20 to 30 percent, according to the complaint. Another plaintiff, Barbara Gehrke from the Sacramento suburb of Rancho Cordova, tells a similar tale in the complaint, claiming Spark representatives using a scripted sales pitch told her she could save money on energy bills. Instead, her bills increased approximately 100 percent. Additionally, the plaintiffs say Spark was running a broader scheme that employed deceptive and high-pressure sales tactics using scripts, training and marketing materials to encourage their door-to-door sales representatives to target low-income residents, the elderly and people who speak little to no English. Attorneys for Spark moved to compel arbitration, citing a clause in the terms of service sent to Gehrke. The plaintiffs, however, argued that the terms given to Gehrke did not contain any such clause – leading White to determine the factual dispute precludes compelling arbitration at this time. On the motion to dismiss, Spark argued that since it provided the scripts it used to train its sales representatives and no such “fraudulent and deceptive bait-and-switch sales practices” were evident. But White noted that the complaint does not contain the sales scripts – they were attached to one of Spark’s declarations – and the plaintiffs question their authenticity, so dismissal would be inappropriate at this time. “The sales scripts proffered by defendants are in tension with the factual allegations of the complaint regarding what occurred during the ‘apparently “scripted”‘ conversations, but the factual allegations of the complaint are not conclusory and the proffered scripts are insufficient to effectively and persuasively rebut them,” White wrote in the 14-page ruling. Spark declined to comment on White’s ruling. The plaintiffs’ lead attorney William Audet did not respond to an email requesting comment by press time. Spark is represented by Paul Karlsgodt.